| 1 | 1 | | 1.1 A bill for an act |
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| 2 | 2 | | 1.2 relating to taxation; corporate franchise; imposing an additional tax on certain |
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| 3 | 3 | | 1.3 corporations with high principal executive officer to median worker pay ratios; |
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| 4 | 4 | | 1.4 disqualifying certain companies from receiving state subsidies and grants; amending |
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| 5 | 5 | | 1.5 Minnesota Statutes 2024, sections 16B.981, by adding a subdivision; 290.06, |
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| 6 | 6 | | 1.6 subdivision 1. |
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| 7 | 7 | | 1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: |
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| 8 | 8 | | 1.8 Section 1. Minnesota Statutes 2024, section 16B.981, is amended by adding a subdivision |
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| 9 | 9 | | 1.9to read: |
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| 10 | 10 | | 1.10 Subd. 7.Disqualification from eligibility to receive grants.A corporation that is |
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| 11 | 11 | | 1.11subject to the additional tax under section 290.06, subdivision 1, paragraphs (b) to (j), is |
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| 12 | 12 | | 1.12ineligible to receive a grant. The agency may require any additional information to make |
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| 13 | 13 | | 1.13this determination. |
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| 14 | 14 | | 1.14 EFFECTIVE DATE.This section is effective January 1, 2026. |
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| 15 | 15 | | 1.15 Sec. 2. Minnesota Statutes 2024, section 290.06, subdivision 1, is amended to read: |
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| 16 | 16 | | 1.16 Subdivision 1.Computation, corporations.(a) The franchise tax imposed upon |
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| 17 | 17 | | 1.17corporations shall be computed by applying to their taxable income the rate of 9.8 percent. |
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| 18 | 18 | | 1.18 (b) The tax rate under paragraph (a) is increased as provided in paragraphs (c) to (i) if |
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| 19 | 19 | | 1.19the corporation's pay ratio meets the requirements of paragraphs (c) to (j). |
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| 20 | 20 | | 1.20 (c) An additional tax equal to 0.2 percent is imposed for the taxable year if the |
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| 21 | 21 | | 1.21corporation's pay ratio is at least 50:1 but less than 100:1. |
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| 22 | 22 | | 1Sec. 2. |
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| 23 | 23 | | 25-01500 as introduced01/21/25 REVISOR EAP/BM |
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| 24 | 24 | | SENATE |
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| 25 | 25 | | STATE OF MINNESOTA |
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| 26 | 26 | | S.F. No. 1936NINETY-FOURTH SESSION |
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| 27 | 27 | | (SENATE AUTHORS: DIBBLE, Boldon, Marty and McEwen) |
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| 28 | 28 | | OFFICIAL STATUSD-PGDATE |
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| 29 | 29 | | Introduction and first reading02/27/2025 |
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| 30 | 30 | | Referred to Taxes 2.1 (d) An additional tax equal to 0.4 percent is imposed for the taxable year if the |
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| 31 | 31 | | 2.2corporation's pay ratio is at least 100:1 but less than 200:1. |
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| 32 | 32 | | 2.3 (e) An additional tax equal to 0.6 percent is imposed for the taxable year if the |
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| 33 | 33 | | 2.4corporation's pay ratio is at least 200:1 but less than 300:1. |
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| 34 | 34 | | 2.5 (f) An additional tax equal to 0.8 percent is imposed for the taxable year if the |
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| 35 | 35 | | 2.6corporation's pay ratio is at least 300:1 but less than 400:1. |
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| 36 | 36 | | 2.7 (h) An additional tax equal to one percent is imposed for the taxable year if the |
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| 37 | 37 | | 2.8corporation's pay ratio is at least 400:1 but less than 500:1. |
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| 38 | 38 | | 2.9 (i) An additional tax equal to 1.5 percent is imposed for the taxable year if the |
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| 39 | 39 | | 2.10corporation's pay ratio is at least 500:1. |
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| 40 | 40 | | 2.11 (j) For purposes of this subdivision, "pay ratio" means the pay ratio disclosed under |
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| 41 | 41 | | 2.12Code of Federal Regulations, title 17, section 229.402(u)(1)(iii), during the taxable year, |
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| 42 | 42 | | 2.13except that a unitary business must determine its pay ratio by calculating the cumulative |
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| 43 | 43 | | 2.14pay ratio of all members of the unitary group. |
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| 44 | 44 | | 2.15 EFFECTIVE DATE.This section is effective for taxable years beginning after December |
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| 45 | 45 | | 2.1631, 2025. |
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| 46 | 46 | | 2Sec. 2. |
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| 47 | 47 | | 25-01500 as introduced01/21/25 REVISOR EAP/BM |
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